Canadians should see an even higher price at the pumps this summer, according to one expert on the matter.
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“Oil will remain around $105 to $125 a barrel. Summer demand is getting closer. I know a lot of people are likely to reconsider these prices and their desire to hit the streets, but that won’t dampen global oil demand,” Dan McTeague, president of Canadians for Affordable Energy, told the CP24 network.
The latter has been forecasting the price of black gold for 27 years, relying in particular on the website gazwizard.ca. It could become common for him to see a pump price of $2 per liter starting in June.
A first increase at Easter
Even for Sunday, the price at the pump in Montreal is only 7 cents below that two dollar mark. In just 72 hours, the metropolis has already experienced a price increase of 24 cents. “This is a rate I’ve never seen before, it’s unprecedented and doesn’t bode well for the summer,” added McTeague, speaking of the rising price at the Toronto pump from 23 cents over the same period.
The specialist explains that the increase is partly due to the switch from winter fuel to summer fuel, an annual event that drives prices up in general. Winter gasoline uses butane, which is cheaper to produce and fires engines faster in cold weather. Summer blends, on the other hand, use alkylates, materials more commonly found in premium gasoline. This conversion usually costs the consumer five to eight cents more per liter.
However, the specialist claims there is more to it than that. He warns that in the event of other disruptions to global fuel production or distribution, such as a hurricane or pipeline disruption, could be even higher.
“We are in a new era,” he said. “The Canadian dollar is not responding to rising oil prices because we are not building pipelines to markets that desperately need Canadian oil, and we have taxes on accumulated taxes… all of these things make a bad situation even worse.”